Taylor v Diamond

Where the court has directed a sale by a chargee in possession and given that party conduct of the sale, the primary choice of estate agents remains with the chargee in possession. The court need not replace the chosen agents with agents selected by the other party, although it may require additional agents to participate where that is justified by the evidence. A marketing period should be sufficient to provide fair exposure to the market, but should also minimise prejudice to the chargee in possession. The person conducting the sale may consider not only price but also the deposit, financing, speed of completion and dependence on another sale when deciding which offer to accept.

The court had previously made orders concerning the sale of property in which Mr Taylor was selling as chargee in possession. Ms Diamond made a further application to vary those orders. She sought the appointment of Faron Sutaria as joint agents, a specified marketing arrangement and an extension of the marketing period. The application followed the court’s decision to direct the appointment of Barnard Marcus as additional agents, after considering evidence about the marketing of the property and the agents’ competing positions.

The issues were whether the existing order should be varied, whether the marketing period should be extended, and who had ultimate control over the sale and the acceptance of offers.

1. The Eleventh Application was determined without a hearing and was dismissed. The court found no ground to vary the existing order and no reason to extend the marketing period.

2. Because Mr Taylor was selling as chargee in possession, and the order concerning the sale had given conduct of the sale to his solicitors, the primary choice of agents was his. The court would not direct him to disinstruct agents of his choice and appoint sole agents selected by Ms Diamond. It could nevertheless require additional agents to participate where the evidence justified that course.

3. The court was not persuaded by Faron Sutaria’s earlier assertion that a sole-agency instruction and full marketing campaign were crucial to achieving the best price. That assertion misstated the relevant duty and misunderstood who owed it. The court considered six weeks’ exposure to the market sufficient in the circumstances, particularly given the potential purchasers already identified and the evidence of a recent sale achieved within four weeks.

4. Ms Diamond no longer controlled the sale process. The ultimate decision whether to accept an offer belonged to Mr Taylor as chargee in possession. In making that decision he could consider the price and all other circumstances attending the offer, including the size of the deposit, availability of finance, speed of completion and dependence on another sale.